Home Development Mutual Fund (1)

December 4, 2007 FIRB RESOLUTION NO. 016-07 SUBJECT MATTER : Home Development Mutual Fund (1) WHEREAS, the Home Development Mutual Fund (HDMF) was primarily created as a socialized savings program for the benefit of low- and middle-income earners and that there is a need to put it at par with other socialized savings programs operated by the Government Service Insurance System and the Social Security System, both of which enjoy outright tax exemption privileges; TcIAHS WHEREAS, the HDMF is in the forefront of the shelter financing program of the government through its provision of affordable loan packages and institutional loans; WHEREAS, the HDMF is mandated to pay guaranteed dividends to its members at an annual fixed rate of seventy percent (70%) of its annual net income; EATcHD WHEREAS, the payment of the income tax liability of the HDMF on its 2007 net income out of its own resources would have adverse effects on its capability to continuously offer lower interest rates on its various loan programs as well as on the sustenance of its support to the National Shelter Program of the government and impair the dividends to be declared in favor of its members; WHEREAS, while the income tax liability on its 2007 net income is paid on a quarterly basis, the last quarter return is an adjustment return and cannot be finalized until the end of the taxable year; aAEHCI NOW, THEREFORE, BE IT RESOLVED, AS IT IS HEREBY RESOLVED to grant tax subsidy to the HDMF to cover its 2007 income tax liability: Provided, however, that the amount shall be based on its final or adjustment income tax return net of the payments it had already made in the amount of P762,286,538.93: Provided further, That the grant of such tax subsidy shall be in accordance with the terms and conditions of Section 14 of the 2007 General Appropriations Act, subject to the availability of funds therefor, pursuant to the terms and conditions of the Rules and Regulations to Implement the Tax Subsidy Provisions under Executive Order No. 93. (SGD.) GIL S. BELTRAN Undersecretary of Finance Presiding Officer FIRB Reference: Joint FIRB-Technical Committee Meeting dated December 4, 2007